NEC Wants to Put a Stop to Unlocking Mobile Phones

[Mike Temporale]

<div class='os_post_top_link'><a href='http://www.engadget.com/entry/1234000017022753/' target='_blank'>http://www.engadget.com/entry/1234000017022753/</a><br /><br /></div><i>"Right now there’s sort of an unwritten rule about unlocking your handset so it’ll work with a different carrier than the one you bought it from—the carriers and cellphone companies won’t necessarily make it easy for you, but they also won’t stop you from doing it, either. That might be changing. NEC is threatening to sue several companies in the UK that are offering to unlock NEC’s ThreePay cellphones for people. Ostensibly they’re doing this to protect their intellectual property (something to do with proprietary software on the phone), but can we just admit that the real reason they’re doing this is to stop people from buying a heavily-subsidized phone from 3 and then jumping ship to another carrier? Carriers hate unlock phones since it makes it harder for them to make back those subsidies that they use to lure new subscribers in the first place."</i><br /><br />This is a little confusing. If NEC is worried about their intellectual property, SIM unlocking a phone is not going to effect that. Application unlocking would. SIM unlocking is just going to allow people to take their phones to another carrier. However, NEC shouldn't care about that, since they've already made the sale to the carrier. So regardless of the subsidies that are offered, NEC has already been paid. So if SIM unlocking is the issue, I would expect the carrier should be suing, and not NEC. What do you think? Am I totally off base here?

[Beowulf]

I would say yes that sounds right, but my guess is that the carrier has put pressure on NEC to sue because the carrier is not in a good position to sue since they don't own any of the copyrights on the software and design of the phone. These companies basically "hack" NEC's software to unlock it.

Either the carrier is paying NEC to sue these people or far more likely they signed a contract with the carrier holding NEC responsible for losses incurred from easily unlock able phones.

A lot of companies sign contracts like that now-a-days to try to get manufacturers to take responsibility for releasing hack-able devices.

[PPCMD]

I disagree with this. The carrier reclaims their "lost revenue" through early termination fees. If they are loosing so much money do what Cingular does, prorate the ETF over the length of the contract. Intellectual property, don't buy it. Its there if someone really wants to hack it, crack it or just plain steal it. If I bought the phone and pay full price I own the phone period and can use it on any carrier who supports it. If I get a phone with that is subsidized then I expect to pay for it through a contract or ETF. I don't buy NEC products and don't see me doing anytime in the future.

[possmann]

I agree - I find this action a bit perplexing - unless unlocking the phone allows a person to get into the actual firmware... to which case I believe that NEC would ahve an opportunity to lock that portion down - thereby allowing people to look at purchasing the phone rather than the contract (service)_.

Back to my burning desire to have the industries seperate themsleves - hardware, software and service - kinda like the PC and INternet model. I don't buy a PC from AOL becuase it has AOL pre-loaded and a year contract - why should I buy a phone with that type of restriction as well. I want to choose the phone I need/want, safter I want to put on it and service that best fits my needs.

"don't fence me in"

Sigh - it's a pipe dream I know - but hey! I can dream...

[Jerry Raia]

Well anyone can sue. They still have to win :)

[PPCMD]

Very true Jerry, but NEC has lots of money and time to spare suing is their game. This could drag on for years. :(

[Jerry Raia]

Years is good. In 6 months who knows how many phones will come out, in years we may all have implants instead of phones. I'm saying this tongue in cheek of course but my point is I think its just gas what NEC is doing and won't effect much of anything. :wink:

How big a player is NEC in cell phones anyway? People who sue like this are usually loosing and this is their last straw.

[Kris Kumar]

I think I can see NEC's view point. Unlocking the phone is the same as hacking or cracking the software on the phone or in other words the intellectual property. I see that as modifying the Windows XP registration key, so that you can go from illegal to legal version.

That said, I agree with Jerry, this is NEC's last straw. They can claim that by unlocking the phone, the customer is able to switch carriers. Had they not been able to do so, the customers would have bought a second phone and possibly from NEC when they switch carriers.